PdV Keeps Nynas Board Seat After Restructuring

(Argus, 13.May.2020) — Venezuela’s state-owned PdV has retained one seat on the new corporate board of European specialty refiner Nynas after a restructuring that freed the venture from US sanctions.

The new board composition illustrates PdV’s small but enduring role in the European downstream business that it acquired in the mid-1980s.

Under the restructuring, PdV reduced its stake in Nynas to 15pc from a previous controlling stake of 50.1pc. The 35pc was moved into independent Swedish foundation Nynässtiftelsen, which Nynas established to ensure that it “is not nor will become a sanctioned party,” the refining company said. The remaining 50pc of Nynas is owned by Finnish refiner Neste.

PdV’s share reduction, which led the US Treasury’s Office of Foreign Assets Control (Ofac) to lift sanctions on Nynas yesterday, has drawn a sharp rebuke from Venezuela’s US-backed opposition, which has not succeeded in extending its control over PdV’s US assets since last year to the US-sanctioned company’s dwindling portfolio of other overseas assets, including Nynas.

“The change of ownership has been reviewed in its entirety by OFAC and it meets the requirements of the US authorities and this has now led to Nynas being relieved from the impact of US sanctions,” Nynas said.

The new Nynas board is comprised of nine directors, including one from PdV. The foundation will appoint two others, Nynas told Argus.

Individual appointments were not disclosed. “The composition of the board is an ongoing process and it will be public in some time,” Nynas said.

Prior to the restructuring, Nynas had 11 board members, including three from PdV, according to the firm’s 2018 annual report.

‘Behind our backs’

Venezuela’s opposition is pressing for details on the transaction, including any revenue that PdV may have received for the transfer of its stake.

The office of special attorney general Jose Ignacio Hernandez, a key member of opposition leader Juan Guaido’s Western-recognized interim administration, urged the opposition-controlled National Assembly to investigate the operation.

An “ad hoc” parallel PdV board that represents the Guaido administration said today that “the operation was carried out without consultation and behind the backs of the interests of the nation.” The board said it would support any actions necessary to determine the damage to Venezuela’s patrimony and PdV’s strategic assets.

Elias Matta, who heads the National Assembly’s oil commission, said the transaction is unconstitutional because it was not approved by the assembly.

PdV in Caracas has not commented.

Preliminary recommendations issued in March by a PdV restructuring commission, headed by now oil minister Tareck El Aissami, highlighted the value of the Nynas asset. In a proposed revised PdV corporate structure, Nynas would fall under a new PdV Russia subsidiary, from a current European subsidiary.

— By Patricia Garip

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